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Medicaid Madness Continues as the Rules Change Once Again

April 30, 2006


On February 8, 2006, President Bush signed the Deficit Reduction Act of 2005 (“DRA”) and significantly changed the Medicaid rules. Medicaid is a joint federal and state program that provides benefits to qualified applicants based on financial need. In Massachusetts, eligibility is determined by the Division of Medical Assistance. When faced with nursing home costs, many seek to maximize the retention of assets for their family by obtaining Medicaid eligibility as soon as possible. This article focuses on the changes that will affect an applicant’s ability to obtain benefits as a resident of a nursing home.

Although the DRA changes the federal rules as of February 8, 2006, each state has until the first day of the first calendar quarter beginning after the end of the legislature’s next session to comply with the DRA. Thus, if the legislative session begins on September 1, 2006, and ends in December of 2006, the deadline is January 1, 2007. Until the state laws and regulations are implemented, eligibility for any applicant will be determined under the current rules.

When applying for Medicaid, the date of the application will control which rules will apply. If the application is filed before the new rules are implemented in Massachusetts, the old rules will apply, but if the application is filed after the new rules are implemented, the new rules will apply. As planning and structuring assets for eligibility often takes months to complete and it is unknown when the new Massachusetts regulations will be implemented, there is a great deal of uncertainty among elder law practitioners regarding proper planning strategies, as a plan crafted under the old rules may not pass muster under the new rules. Unfortunately, this may hasten institutionalization in order to apply for care sooner in order to qualify under the old rules…

You may read more at the link below.

by: Gina M. Barry, Esquire

May 2006

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